Page 108 - issue
P. 108
Goodwill! Photograph the stuff, make a Price that allows you to put aside 3) If you are eligible for the earned
careful list, and get a receipt. $2,500 for each child, and you can get income tax credit (for the “working
a tax deduction – on your Maryland poor” with children), your investment
7) Daycare and summer camp are tax return only. If you are paying for income cannot exceed $3,400. This is
eligible for a tax credit if both parents college, this might make sense, but it a big headache if you own mutual
work. This caps at $6,000 per year if is complicated, because doing this will funds, since you never know – nor can
two children are receiving care. (That make the federal tax credits more you control – when they create capital
means you save 28% of $6,000). The complex. Those of you who pay a lot gains. You can blow this credit by
money does not have to be evenly in college tuition should for sure look going just one dollar over the limit.
spent on the children. Spending over into this. The earned income credit is a massive
the $6,000 a year is a waste; try to save money handout that you do not want
it for next year! Miscellaneous Issues to lose.
Here are some other things to think
8) If your investment expenses about: 4) If you are an employee and
added to your job expenses are over spend money for your job, these
2% of your income, the excess is an 1) If debt is forgiven, you will expenses can be tax free if your
itemized deduction. This is not very receive a 1099-C, usually taxable. This employer reimburses you. Better keep
common. If you are close, bunching happens if a credit card company good records and be sure that you are
can work here as well. writes off a balance. You had better being reimbursed for what you spend
get advice, as this can be a major and no more.
9) Maryland follows the federal ouch!
deductions but adds a few of its own. 5) Lawsuit awards for nonphysical
Deductions are allowed for part of 2) A “nanny tax” applies to all damages are generally taxable.
your pension and social security household employees. Most people
income, and there are credits for long- would love to skirt this one. One legal 6) Open a bank account called an
term care insurance as well as for con- way to do that is to pay under the HSA (health savings account) if your
tinuing education for public school limit: for example, if you pay less than health insurance policy makes you eli-
teachers. $1,900 per year to any one employee, gible (high deductible) for one. This is
and do not top $1,000 per quarter in an important deduction and often
10) You can participate in the total payment to all employees. overlooked!
Maryland College Investment Plan.
You open a special account at T. Rowe (continued on page 132)
JEWISH VOLUNTEER CONNECTION’S SDAETCU2R4D–AYSUEVNEDNAIYN,GD,EC 25
COMMUMNIITTZYVAH DAY G VEKICKOFFCHANUKAH
JVCBALTIMORE.ORG/MITZVAHDAY
by giving back to the BACK
community where we
all live, work and play!
Sponsored by
104 u www.wherewhatwhen.com u
careful list, and get a receipt. $2,500 for each child, and you can get income tax credit (for the “working
a tax deduction – on your Maryland poor” with children), your investment
7) Daycare and summer camp are tax return only. If you are paying for income cannot exceed $3,400. This is
eligible for a tax credit if both parents college, this might make sense, but it a big headache if you own mutual
work. This caps at $6,000 per year if is complicated, because doing this will funds, since you never know – nor can
two children are receiving care. (That make the federal tax credits more you control – when they create capital
means you save 28% of $6,000). The complex. Those of you who pay a lot gains. You can blow this credit by
money does not have to be evenly in college tuition should for sure look going just one dollar over the limit.
spent on the children. Spending over into this. The earned income credit is a massive
the $6,000 a year is a waste; try to save money handout that you do not want
it for next year! Miscellaneous Issues to lose.
Here are some other things to think
8) If your investment expenses about: 4) If you are an employee and
added to your job expenses are over spend money for your job, these
2% of your income, the excess is an 1) If debt is forgiven, you will expenses can be tax free if your
itemized deduction. This is not very receive a 1099-C, usually taxable. This employer reimburses you. Better keep
common. If you are close, bunching happens if a credit card company good records and be sure that you are
can work here as well. writes off a balance. You had better being reimbursed for what you spend
get advice, as this can be a major and no more.
9) Maryland follows the federal ouch!
deductions but adds a few of its own. 5) Lawsuit awards for nonphysical
Deductions are allowed for part of 2) A “nanny tax” applies to all damages are generally taxable.
your pension and social security household employees. Most people
income, and there are credits for long- would love to skirt this one. One legal 6) Open a bank account called an
term care insurance as well as for con- way to do that is to pay under the HSA (health savings account) if your
tinuing education for public school limit: for example, if you pay less than health insurance policy makes you eli-
teachers. $1,900 per year to any one employee, gible (high deductible) for one. This is
and do not top $1,000 per quarter in an important deduction and often
10) You can participate in the total payment to all employees. overlooked!
Maryland College Investment Plan.
You open a special account at T. Rowe (continued on page 132)
JEWISH VOLUNTEER CONNECTION’S SDAETCU2R4D–AYSUEVNEDNAIYN,GD,EC 25
COMMUMNIITTZYVAH DAY G VEKICKOFFCHANUKAH
JVCBALTIMORE.ORG/MITZVAHDAY
by giving back to the BACK
community where we
all live, work and play!
Sponsored by
104 u www.wherewhatwhen.com u
